What is the par value of Gokhale Method's common stock?
Gokhale_Method Franchise · 2024 FDDAnswer from 2024 FDD Document
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| 2023 | |
|---|---|
| ASSETS | |
| Cash and cash equivalents Accounts receivable, net | $ 154,584 15,944 |
| TOTAL ASSETS | $ 170,528 |
| LIABILITIES AND STOCKHOLDER'S EQUITY | |
| LIABILITIES Accounts payable and other current liabilities Deferred revenue | $ 8,491 48,956 |
| Total liabilities | 57,447 |
| STOCKHOLDER'S EQUITY Common stock (1,000 voting shares authorized, 500 shares issued and outstanding, $0.01 par value) | 5 |
| Common stock (1,000 non-voting shares authorized, no shares issued and outstanding, $0.01 par value) | - |
| Additional paid in capital Retained earnings | 100,657 12,419 |
| Total stockholder's equity | 113,081 |
| TOTAL LIABILITIES & STOCKHOLDER'S EQ |
Source: Item 22 — CONTRACTS (FDD page 34)
What This Means (2024 FDD)
According to Gokhale Method's 2024 Franchise Disclosure Document, the company has two classes of common stock: voting and non-voting. Both classes have a par value of $0.01 per share. There are 1,000 voting shares authorized, with 500 shares issued and outstanding. There are 1,000 non-voting shares authorized, but none have been issued or are outstanding.
The par value of a stock is the nominal value assigned to a share when it is initially issued by the company. It is typically a very small amount, as seen here with Gokhale Method. The par value is primarily an accounting concept and has little relevance to the market value of the stock.
For a prospective Gokhale Method franchisee, this information provides insight into the company's capitalization structure. While the par value itself is not a critical factor in evaluating the franchise opportunity, it does contribute to understanding the overall financial structure of the franchisor. The fact that there are authorized but unissued non-voting shares could indicate potential future plans for raising capital or structuring ownership, which a franchisee may want to discuss with the franchisor.